Earnings Report /
Thailand

Precious Shipping PCL: Hefty 2Q22 profit!

  • Stronger result than we had expected

  • PSL posted a 2Q22 net profit of Bt1,660m

  • Revenue rose by 36% YoY and 15% QoQ

Bualuang Securities
8 August 2022

PSL’s stock price has slipped 5% since our July 11 rating downgrade from TRADING BUY to HOLD. We think the market has now mostly priced in the dulled macroeconomic outlook. Hence, if global inflation peaks and Ukraine can resume exporting grain at scale, we would expect dry bulk shipping demand and PSL’s stock price to soar. We have upgraded our call from HOLD to TRADING BUY. Our target price stands unchanged at Bt20 (pegged to a 2022 PER of 6.2x, 0.5SD below PSL’s long-term mean).

Stronger result than we had expected

PSL posted a 2Q22 net profit of Bt1,660m, up by 101% YoY and 28% QoQ. The reported bottom-line was 42% ahead of our estimate (the T/C rate for Ultramax class vessels was much higher than we had assumed), but was in line with the consensus projection. Stripping out extra items, the core number would be Bt1,639m, up by 113% YoY and 26% QoQ. The core number was also 41% ahead of our estimate (the T/C rate for Ultramax class vessels was much higher than we had assumed), but was in line with the street.